Cause-Based Crowdfunding War Heats Up As Indiegogo Rebrands With 'Generosity'

Indiegogo cofounder and CEO Slava Rubin (Photo: Neilson Barnard/Getty Images for The New York Times)

When Indiegogo launched in 2008 at the Sundance Film Festival, the world's first crowdfunding platform focused originally on just backing movies. Since then, the site has evolved around the possibility of raising money for any project or idea.

While that much is still true, Indiegogo, which is often seen as an alternative to Kickstarter, is going beyond physical projects and furthering its interests in what is the crowdfunding industry's largest vertical: cause-based campaigns. On Wednesday, the San Francisco-based company rebranded its cause-based crowdfunding arm, formerly known as "Indiegogo Life" into a new website called "Generosity."

"We’ve seen the impact that a group of people coming together to support an important social cause can have and our commitment to support nonprofit and personal funding has literally changed lives for the better," wrote Indiegogo cofounder and CEO Slava Rubin in an email to FORBES. "We’re now making that easier with Generosity."

For Indiegogo, the rebranding to Generosity is an attempt to re-establish the company in crowd-based crowdfunding, where people can raise money from strangers to pay for college tuition or help fund a parent's surgical procedure. It is also a response to the growth of competitor GoFundMe, the leading platform for personal causes that said in September that it raised $1 billion in donations over the previous 12 months and $1.6 billion since its 2010 launch.

Indiegogo, by comparison, has totaled pledges over the course of its nearly seven-year history of about $750 million for projects ranging from personal robots to fitness trackers to disaster area aid. Rubin declined to address GoFundMe when asked about the company and only said that Indiegogo was "the first to offer personal funding and nonprofit funding."

First or not, it's undeniable that GoFundMe has developed a clear early lead in the causes space. In response, Indiegogo is reiterating with Generosity that it will take no commission for any cause-based campaigns in an attempt to steal away business from its San Diego-originated adversary. GoFundMe charges a 5% fee for all money raised plus additional credit card processing fees, while project-based campaigns on Indiegogo typically require a 5% commission payment plus additional add-ons. (Generosity will allow for a user to tip the company any amount if they choose to.)

"In their time of greatest need, people don’t need a cheap platform, they need one that works," said GoFundMe CEO Rob Solomon in an email statement when asked about the differences in pricing between the platforms. "Successful tools require a business model that allows focus and a real investment in technology, safety and customer service."

In the early days of the cause-based competition, that has been true for GoFundMe, which has coexisted with Generosity's non-fee predecessor, Indiegogo Life, since its late 2014 launch. In earlier interviews, Solomon said that Indiegogo's presence has had little impact, with users flocking to GoFundMe to find campaigns such as one that raised more than $800,000 for a former soldier who was shot seven times during a recent gun rampage at Umpqua Community College in Oregon. Indiegogo declined to disclose how much Life had raised in donations before its rebranding.

Aside from the differences in fee structure, the two sites will operate very similarly. Indiegogo has done away with time limits on Generosity, allowing a campaign to be an open-ended amount of time similar to what is allowed on GoFundMe. Generosity also provides integrations so that users can run their campaigns on their own personal websites.

"Since we launched in 2008, we’ve always urged people raising funds to be completely transparent about their goals and needs," said Rubin. "That’s the same if you’re making a tech product or if you’re raising money for a nonprofit or person in need. Doing away with deadlines was something our customers asked for with these types of social impact fundraisers to make it easier to support positive social initiatives.”

Existing Indiegogo Life listings will be transitioned into the new platform, while Generosity is also launching with four new nonprofit campaigns, including Learning Equality, the nonprofit behind Khan Academy Lite, which is raising money for a new offline learning platform, and the Leukemia and Lymphoma Society, which is seeking funding for 100 Bay Area blood cancer patients.

Update on Oct. 25, 2015 at 9:45 p.m.: This post has been updated to better explain the Learning Equality campaign that launched on Generosity.